by Terry Rogers
On Monday, July 6, Milford School District Board of Education voted to reduce the tax rate by 0.8 percent. The reduction was due to a decline in debt service needs due to the expiration of a bond obligation as well as the decrease in minor capital improvement funds as allocated by the State Bond Bill.
“This marks the fourth straight year that we were able to decrease school taxes,” Sara Croce, Chief Financial Officer, said. “Overall, state allocations remained the same for this year and we are grateful for the budget considerations given for education. Although there were no major decreases to our funding, there were no increases either. The state remained committed to State Opportunity Funds, which are important to serving many Milford students.”
A home in Kent County that has an assessed value of $29,250 and one in Sussex County with an assessed value of $10,380 will see a reduction in their annual taxes of $421 while a home assessed at $114,457 and one in Sussex County with an assessed value of $40,500 will see a reduction of $16.48. Although the assessed values are different, the rates remain the same due to differences in each county’s appraisal rates.
“The last tax assessment in Kent County was completed in 1986 and in Sussex in 1974,” Croce has said in the past. “Newer houses are being assessed at higher values in both counties as there are building materials that were not available during the last assessments, like composite decking and granite countertops” In 2019, a federal judge ruled that the method used in Delaware for property assessments was unconstitutional but no decision has been made regarding new assessments or changes to the process.
In order to significantly renovate an existing building or construct a new school, public school districts must hold a referendum obtaining approval from the taxpayers. Once the referendum is approved by the voters, the General Assembly approves the issuance of bonds to cover the cost of construction. The school district must use county tax receipts to repay those bonds which are usually between 20 and 40 percent of the construction cost. As debts are paid, the cost of debt service goes down and those savings are passed along to the taxpayer in the form of lower taxes.
Other portions of the school tax include current expenses which cover operating costs such as teaching materials, textbooks, and the local share of salaries. This rate cannot be changed unless it is approved through referendum. Match taxes are set by the Board of Education and do not require referendum. The district may assess Minor Capital Improvement, Extra Time, Technology, Reading Specialist, Math Specialist and Reading Interventionist taxes. Currently, Milford only assess the Minor Capital Improvement tax. If they do not assess that tax, they do not get state funding for building and ground repairs or maintenance.
Tuition tax provides revenue to pay tuition for district students with special needs. The tax helps cover the cost of special services that cannot be provided by Milford School District. A few years ago, the district incurred unexpected expenses for special education which required raising this portion of the tax rate significantly. Since that time, the district has implemented strategies to stabilize those expenses, allowing them to reduce the tuition tax rate over the past few years. This year the rate was lowered 0.9 percent. The district stopped collecting Capitation Tax in 2005.